Preferred stock investors play waiting game as Greek saga unravels; PartnerRe improves

By Stephanie N. Rotondo

Phoenix, July 7 – Preferred stock investors continued to sit on the sidelines early Tuesday, as the world remained focused on the ongoing Greek drama.

Talk is that there is a verbal debt deal on the table and that Greece will formally propose the deal to E.U. officials on Wednesday. As hopes increase that a deal will get done, Treasury bonds are improving and taking preferreds along with it.

A trader said the bond market was up 1.5 points early in the day, while the Wells Fargo Hybrid and Preferred Securities index inched up 6 basis points.

Though liquidity was on the light side, JPMorgan Chase & Co.’s (NYSE: JPMPG) series G preferreds were rather active, with about 667,000 shares being exchanged.

The preferreds – which will be added to the S&P U.S. Preferred Stock index on July 17 – ended the day a penny higher at $24.93.

PartnerRe Ltd.’s preferreds got a sizable boost Tuesday after EXOR SpA sweetened a buyout offer for the Pembroke, Bermuda-based reinsurance company.

The 6.5% series D cumulative redeemable preferreds (NYSE: PREPD) closed up 43 cents, or 1.7%, at $25.70, while the 7.25% series F cumulative redeemable preferreds (NYSE: PREPE) improved 42 cents, or 1.61%, to $26.54.

In an improved offer announced Tuesday EXOR said it would exchange PartnerRe’s existing preferreds with new preferred securities that offer call protection until 2021 and a 100 bps increase on any dividends.

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